Multiple Stocks For Starting Traders
If you're barely making good savings as it is, then how would investments be possible? For example, let's say you're making about $25,000 in a year. Subtract all the necessary expenditures like, feeding yourself, paying for mortgages, gas money for your car, and other expenses, and you know you have to start investing for your future. It's a wise decision to start doing so; as even in small amounts, savings can add up fast if done on a regular basis.
Don't worry about it, Uncle Sam is here and willing to help a citizen of his country. For example, take the statistics over the past ten years. Annually, the stock market returned about eight percent on average, so even if you start with absolutely nothing and invest about ten dollars every week, and match an investment with about eight percent return, you'll have about $8000 in ten years. If you got a better investment, one that goes for about twelve percent in annual returns, you'll even get to ten thousand.
But, remember his, though; investing with small amounts of money doesn't mean that you put it all in one basket. All stock investors, regardless of their experience and talent, will inevitable pick a bad investment that will drop thirty percent before the next morning's coffee cup is empty. If that's only a small percentage of your stocks, then it's not much of a big deal. But if it's a fifth of your money, then you have a financial disaster.
As a small time investor, it would make much more sense to go with mutual fund and exchange-traded funds. And why is that? For starters, mutual funds have something called automatic diversification. Because most investors hold dozens of stock, one that fails will have a minimal impact on their portfolio.
One last thing; these funds should be bought directly from a fund company. Buying them through stockbrokers is not a good idea if you're a small time investor, as most stockbrokers will probably ask for a hefty check to open new accounts. It can be overcome easily, though, and it's not a really big problem. - 23199
Don't worry about it, Uncle Sam is here and willing to help a citizen of his country. For example, take the statistics over the past ten years. Annually, the stock market returned about eight percent on average, so even if you start with absolutely nothing and invest about ten dollars every week, and match an investment with about eight percent return, you'll have about $8000 in ten years. If you got a better investment, one that goes for about twelve percent in annual returns, you'll even get to ten thousand.
But, remember his, though; investing with small amounts of money doesn't mean that you put it all in one basket. All stock investors, regardless of their experience and talent, will inevitable pick a bad investment that will drop thirty percent before the next morning's coffee cup is empty. If that's only a small percentage of your stocks, then it's not much of a big deal. But if it's a fifth of your money, then you have a financial disaster.
As a small time investor, it would make much more sense to go with mutual fund and exchange-traded funds. And why is that? For starters, mutual funds have something called automatic diversification. Because most investors hold dozens of stock, one that fails will have a minimal impact on their portfolio.
One last thing; these funds should be bought directly from a fund company. Buying them through stockbrokers is not a good idea if you're a small time investor, as most stockbrokers will probably ask for a hefty check to open new accounts. It can be overcome easily, though, and it's not a really big problem. - 23199
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posted by X - Men @ 1:32 AM
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